CH 11
Powers of Congress
TAXES
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Article I section 8,Clause I
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Congress has the power to lay and collect Taxes,
Duties, Imposts and Excises, to pay the Debts and
provide for the common Defense and general Welfare
of the United States…”
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Tax- a charge levied by government on persons or
property to meet public needs.
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Protective Tariff- tax for other purposes than the common
good. This tax is on imports increasing their costs and
protecting American manufactured goods
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Licensing by the federal government to certain
manufacturers to produced products that are
generally illegal is another form of taxation
designed to protect public health and safety. This
is considered a Protective Tariff
LIMITS ON TAXATION
Cannot Tax churches- would violate 1st
Amendment free exercise of religion clause.
 Cannot levy a poll tax as a condition of votingwould violate the 24th amendment
 Cannot tax exports from any state- customs
duties only on imports
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DIRECT AND INDIRECT TAXES
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Direct Tax- paid by the person on whom it is
imposed.
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“No Capitation( head fee), or other direct tax shall be
laid, unless the proportion to the Census of
Enumeration herein before directed to be taken”
Article I Section 9 Clause 4
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A capitation tax is a head tax charged to each
individual in the population of each state. This clause
allows congress to levy any tax based on the state’s
population as said by the Census and not on the
income. However, the 16th amendment 1913 deleted
the phrase the “other direct tax” making it possible to
collect taxes in other forms such as and income tax
system that we have today
16TH AMENDMENT
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“The Congress shall have power to lay and collect
taxes on incomes, form whatever source derived
without apportionment among the several
States, and without regard to any census or
enumeration.”
INDIRECT TAX
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Tax paid initially by one person or entity but
then passed on to another. It is indirectly paid by
that second person and directly paid by the first.
BORROWING MONEY
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Article I Sect 8 Clause 2 allows Congress to
“borrow Money on the credit of the United States”
There are no limits set in the Constitution on how
much or how frequently Congress can borrow or for
what purpose they are borrowing the money.
 Deficit Spending- Spending more money than it takes
each year and then borrow to make up the difference.
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Deficit Spending began to finance the New Deal
of FDR after the Great Depression in 1929. The
economic depression lasted 10 years. Then it was
used to raise money for WWII and began after
that funding wars and social programs for
decades
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Beginning in 1969 to 1998 the governments
books ran in a deficit format until after 1998
when there was a short period of economic
surplus when our government brought in more
money that it spend/borrowed.
Each year the public debt( all of the money
borrowed by Congress but not paid back) would
rise.
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Congress continues to borrow in the form of
stocks and bonds(securities) issued by the federal
government
-In 1997 Congress passed the Balanced Budget
Act and Congress and Pres. Bill Clinton agreed to
abandon deficit spending and balance the budget
by 2002. The goal was reached before the end of
his second term as President in 2000. We had a
surplus in 1998,99, 2000 and 2001.
Our Federal Treasury is vague on what our
nations actual debt is…
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Commerce Power is the power of Congress to
regulate interstate and foreign trade and is vital
to keeping order protocol among states and
foreign countries. (Remember Articles of
Confederation)
“To regulate Commerce with foreign Nations, and
among the several States, and with the Indian
Tribes” Article 1 section 8 clause 3
But… how far reaching is the Federal
Governments power in the Commerce Clause???
 Cannot: Tax exports, favor one port of a state
over any other in regulation of trade, cannot say
that vessels bound to, or from State be obliged to
enter, clear or pay Duties to another and finally
could not interfere with the slave trade, at least
not until the year 1808
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The Commerce Power had been used to settle
supreme court cases such as Gibbons V Ogden
over the monopoly of one Steamboat company in
New York ( Robert Fulton gave Aaron Ogden the
only permit for steamboat navigation between
New York and New Jersey- Thomas Gibbons
wanted to have equal access to the river to
operate as well. New York Supreme Court said
no. Federal Supreme Court said yes based on
Commerce Clause)
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Commerce clause also struck the discrimination in
access to services in hotels, motels and theatres and
other accommodations on the basis of race, color,
religion, or national origin in the Civil Rights act of
1964 based on the fact that these businesses served
primarily interstate travelers.
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Gonzales v Raich
FPC v. Niagara Mohawk Power Company
United States v Chicago
Gibson v. United States
South Carolina v Georgia
Cherokee Nation v Georgia
United States v Lopez
Kidd v Pearson
Swift v. United States
Carter v. Carter Coal Company
National Labor Relations Board v. Jones and
Laughlin Steel Corp.
United States v. Darby Lumber Co.
Wickard v. Filburn